Electric utilities transmit and distribute electric power for use by end users or customers. The electric power includes real power and reactive power. Real power supplies energy that is needed by a load to perform actual work, such as running a motor. Reactive power provides voltage regulation to the distribution system. Reactive power exists in an alternating current (“AC”) electric power system when the current and voltage are not in phase. Reactive power is expressed in volt-ampere reactive (“VAR”) units.
During electric power distribution, transmission lines and other devices introduce impedance into the distribution system such as capacitance and inductance. These reactive impedance components cause a current to change phase with respect to the corresponding voltage. For example, capacitance causes a current to lead a voltage in phase, while inductance causes a current to lag a voltage in phase.
Reactive power is introduced into the distribution system to maintain desired voltage levels. For example, reactive power may be introduced into the distribution system having low lagging power factor to reduce “voltage sag”. If reactive power in the distribution system is high, then current flowing through the transmission lines and loads of the distribution system is increased, which leads to increased heat loss and lower system efficiency.